Cisco Systems Inc, the world's largest networking equipment
maker, yesterday unveiled a US$16 billion expansion plan to boost
its presence in China, one of the world's most dynamic telecom
markets.
The plan includes expanding its procurement, manufacturing and
research and development capacity, and increasing investment in
China's education sector and high-growth companies through its
venture capital vehicle.
"We are going to the next chapter in China," said John Chambers,
chairman and CEO of Cisco. "The announcements underscore both
China's strategic importance to Cisco's global operations and the
broad range of growth opportunities presented by the market."
The plan, following a pledged investment of US$1.16 billion in
India on Tuesday, underlines Cisco's increasing aggressiveness in
cracking emerging markets. It pledged a US$1.16 billion investment
in India within two years.
A large portion of the US$16 billion in China would be spent on
procurement, which totaled US$7 billion in the past five years.
As part of the new initiative, Cisco said it will spend US$17.5
million buying into China's top e-commerce firm Alibaba.com, which
is expected to launch an initial public offering in Hong Kong next
Tuesday.
Cisco also signed a memorandum of understanding with China
Development Bank to set up a US$100 million program to provide
capital and expertise for high-growth Chinese companies. Cisco has
invested more than US$700 million in Chinese start-ups over the
past few years.
It also agreed to inject US$400 million into a wholly owned
subsidiary in China that specializes in financing and leasing
services.
The subsidiary, Cisco Systems Capital China, began operation in
2006, aiming to provide financing facilities to Cisco's customers
in China.
"We are now seeing more and more innovations coming for the
market," said Chambers.
(China Daily November 2, 2007)
